Hi everyone,
Am asking a tough one here and would appreciate respect for anyone who has the guts to answer, including me.
Was wondering whether you would be willing to share your property investment mistakes on this thread?
Not looking for advice or consolation, just some honesty about the hard times - keeping in mind that "success is the last step of failure".
Maybe I'm not the only one who would like to know the answers to the following.
In relation to property investment only:
1/ What did you buy or not buy?
2/ What were you thinking? What influenced your thoughts?
3/ What was the result of this mistake?
4/ How did you get through it? What strategies did you use / are you using?
5/ What would you do differently?
6/ What have you learned? What wisdom can you impart?
Me:
1/ I bought a house in outer Melbourne when the market was at it's peak instead of buying the flat next door to the first one I bought in Sydney which is what I really wanted to do.
2/ I was thinking that I'd done so well with the flat that I could buy something more expensive which would increase in value at an even faster pace.
Once I started on this path, the mistakes started to flow. I believed the Melbourne r/e agent about the rent without doing more research and bought the house at an elevated price without seeing it. I think I was influenced by fear of missing out and also by greed.
3/ The mistake is that the GFC came along and the house lost value - ok that's probably the same for nearly everyone.
But the yield isn't any good even though it's a regional area - not helped by me paying too much. Then the rent went down too.
And then my higher income job went and I took on a job where I pay very little tax and now carry most of the negative gearing myself.
4/ I was determined not to sell and would've lost money that way, anyway.
I got through by very quickly getting another full-time job, moving to the country and reducing living expenses significantly - country living is a lot cheaper. Actually, it's been a great move and a great job and I love the house I'm living in.
I was wasting so much money before.
5/ Despite all this, I would consider buying in the same area again - just do it differently.
I would buy a smaller house on a smaller block in a cheaper area.
Also, if I could have time back, I would buy in 2012 instead of 2010!!
6/ What I've learned is that the way I bought that place doesn't work for me. I need to be much more involved. I do need to assess it face-to-face and I need to negotiate with the real estate agent face-to-face.
Also, I rushed in when I should've waited. I had the finance but it wasn't the right time to buy in that area. I already knew that but allowed myself to be influenced by others.
And the flat next to the one I first bought would've been perfect and would've made a tidy profit by now. I should've listened to myself.
Things have become much easier lately. The interest rates have helped heaps and my pay has gone up a bit. I also see the long-awaited capital gains starting to happen on the house. Hope the rents go up soon too!
Next time I'll take my time and listen to myself like I did the first time.
Fools rush in where angels fear to tread.
Anyone else?
Am asking a tough one here and would appreciate respect for anyone who has the guts to answer, including me.
Was wondering whether you would be willing to share your property investment mistakes on this thread?
Not looking for advice or consolation, just some honesty about the hard times - keeping in mind that "success is the last step of failure".
Maybe I'm not the only one who would like to know the answers to the following.
In relation to property investment only:
1/ What did you buy or not buy?
2/ What were you thinking? What influenced your thoughts?
3/ What was the result of this mistake?
4/ How did you get through it? What strategies did you use / are you using?
5/ What would you do differently?
6/ What have you learned? What wisdom can you impart?
Me:
1/ I bought a house in outer Melbourne when the market was at it's peak instead of buying the flat next door to the first one I bought in Sydney which is what I really wanted to do.
2/ I was thinking that I'd done so well with the flat that I could buy something more expensive which would increase in value at an even faster pace.
Once I started on this path, the mistakes started to flow. I believed the Melbourne r/e agent about the rent without doing more research and bought the house at an elevated price without seeing it. I think I was influenced by fear of missing out and also by greed.
3/ The mistake is that the GFC came along and the house lost value - ok that's probably the same for nearly everyone.
But the yield isn't any good even though it's a regional area - not helped by me paying too much. Then the rent went down too.
And then my higher income job went and I took on a job where I pay very little tax and now carry most of the negative gearing myself.
4/ I was determined not to sell and would've lost money that way, anyway.
I got through by very quickly getting another full-time job, moving to the country and reducing living expenses significantly - country living is a lot cheaper. Actually, it's been a great move and a great job and I love the house I'm living in.
I was wasting so much money before.
5/ Despite all this, I would consider buying in the same area again - just do it differently.
I would buy a smaller house on a smaller block in a cheaper area.
Also, if I could have time back, I would buy in 2012 instead of 2010!!
6/ What I've learned is that the way I bought that place doesn't work for me. I need to be much more involved. I do need to assess it face-to-face and I need to negotiate with the real estate agent face-to-face.
Also, I rushed in when I should've waited. I had the finance but it wasn't the right time to buy in that area. I already knew that but allowed myself to be influenced by others.
And the flat next to the one I first bought would've been perfect and would've made a tidy profit by now. I should've listened to myself.
Things have become much easier lately. The interest rates have helped heaps and my pay has gone up a bit. I also see the long-awaited capital gains starting to happen on the house. Hope the rents go up soon too!
Next time I'll take my time and listen to myself like I did the first time.
Fools rush in where angels fear to tread.
Anyone else?
